Good morning. My name is Adriane and I will be your conference operator today. At this time, I would like to welcome everyone to the American Tower Second Quarter 2007 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks there will be a question and answer session. [Operator Instructions]. I would now like to turn the call over to Mr. Michael Powell, Director of Investor Relations. Mr. Powell, you may begin your conference.

Thank you. Good morning and thank you for joining American Tower's conference call regarding our second quarter 2007 results. We'll begin with comments from Brad Singer, our Chief Financial Officer, who will then turn things over to Jim Taiclet, our Chairman and Chief Executive Officer. Before we begin, I would like to remind you that this call will contain forward-looking statements that involve a number of risks and uncertainties. Examples of these statements include but are not limited to statements regarding our full year 2007 outlook, our stock repurchase program, future financing activities, the Verestar bankruptcy proceedings and any other statements regarding matters that are not historical facts. You should be aware that certain factors may affect us in the future and could cause actual results to differ materially from those expressed in these forward-looking statements. Such factors include the risk factors set forth in this morning's press release and those set forth in our Form 10-Q for the quarter ended March 31, 2007 and our other filings with the SEC. We urge you to consider these factors and remind you that we undertake no obligation to update the information contained on this call to reflect subsequently occurring events or circumstances. Please note that our earnings release was furnished this morning to the SEC on a Form 8-K and is also posted on our website. And now I would like to turn things over to Brad Singer.

Thanks Michael. American Tower continued its track record of consistently delivering strong revenue, adjusted EBITDA and free cash flow growth in the second quarter. In our core Rental and Management division, our revenues and gross margins increased 10% and 12% to almost $351 million and approximately $259 million respectively from the second quarter in 2006. On a sequential basis, Rental and Management revenues increased approximately $5 million. On our first quarter earnings call, we stated that we expected our non-cash straight line revenue to decrease sequentially from the first quarter to second quarter by approximately $4 million. Due to a non-cash adjustment in the second quarter, non-cash straight line revenue only decreased $2.5 million. Adjusting for the non-cash revenue decrease, tower revenues grew $7.5 million sequentially from the first quarter. Our total selling, general, administrative and development expense were $42.1 million, including $11.5 million of non-cash stock-based compensation expense. Our selling, general, administrative and development expense also included $1.8 million of costs associated with the stock option review and related matters. Including the costs associated with the stock option-related matters, our adjusted EBITDA increased 12% to $241.4 million and our adjusted EBITDA margin was 67%. Our operating income for the quarter increased to $93 million and our income from continuing operations was $12 million including a pre-tax loss on retirement of debt of $28.9 million, which was partially offset by other income of $14 million related to the termination of interest rate swap hedges on our prior credit facility and the sale of a portion of remaining FiberTower stock. As previously discussed, we received $80 million of net proceeds from the IRS related to the refund claims we filed during 2003. These proceeds did not have an impact on our second quarter income from continuing operations, but improved our working…

Thanks Brad. Good morning everybody. As demonstrated by our very strong financial results, the leasing environment in our served markets remains robust. Our new signed lease business continues to be generated from a broad range of sources, and in the second quarter approximately 80% of our new business was for new cell site installations on our towers and 20% was for augmentations to existing installations. As is typical, a significant proportion of our new business in Q2 came from the national full service carriers. Verizon Wireless maintained its program of capacity and coverage enhancement during the quarter, including the improvement of its 1.9 band coverage and legacy 850 band areas. Sprint Nextel continued to strengthen its networks by deploying CDMA equipment on numerous legacy iDEN sites among other initiatives. We also saw a continued level of activity from AT&T mobility as it works to further deploy UMTS technology across many sites in multiple markets. And we started the process applications with T-Mobile as they focused on deploying their UMTS 3G overlay towards the end of this year. During the second quarter, the emerging unlimited usage carriers, Leap Wireless and MetroPCS were again another valued source of new lease business. Leap was active with us in both enriching the coverage in their existing markets to meet new subscriber growth and in preparing key Auction 66 markets for launch. With MetroPCS, we have supported their LA launch plan for later this year as well as preparing for potential Auction 66 launch markets in the Northeast and other areas. In the category of next generation data and entertainment providers, Clearwire was an important source of new leasing business in Q2 as that company deployed numerous sites in support of its growth plan. In addition, we worked with Sprint Nextel in their WiMAX trial…

[Operator Instructions]. Your first question comes from the line of Jonathan Atkin with RBC Capital Market.

Yes, good morning. A couple of questions. On the strategic front, I wondered if you had any revised thoughts on the distributed antenna system business in an outdoor environment. I know you've kind of evaluated that in the past and given your indoor expertise, I wondered whether you plan on maybe giving that another look, extending that to an outdoor environment. And then with respect to ground repurchases, can you give us also an update on lease extensions and what typically your run rate is in terms of extending ground leases?

Sure, John. I'll take the first one. It's Jim. We do believe the DAS system indoor certainly and outdoor have a role in deployment of wireless networks. And so far, it has... still is in a limited role. But we are interested in this space. We are evaluating some options as to add that capability to what we offer our customers and we'll continue to do that. We haven't made a formal decision yet as to exactly how to enter this space though.

Hey, John, it's Brad. With regard to ground leases, we have a program in place that every lease that comes up for renewal in the next 10 years, we basically either buy the land or extend that lease. And we've made significant progress. It's about I think a little -- about between 12% and 13% of all our leases come up in the next 10 years, and that's what we have been working through. And each quarter we make more progress and that is... program is very straightforward and methodical in how we approach it.

And then finally on the pricing environment on new leases, since a lot of the new business is coming on at new frequencies other than just PCS and cellular, curious whether the new leases include any kind of flexibility for future augmentations. Are people prepaying some of the amendment revenues, if you will, or are the leases structured pretty much the same as they have historically?

Yes, John, no, we don't comment on specific customer agreements, but the parameters of our pricing structure essentially remain the same. It's location first and then it's equipment and ground space that's needed second. And within those general parameters, we can structure individual contracts that we end up believing are mutually beneficial for us and that specific customer. So I don't think the fundamentals have changed. Our flexibility, I don't think, hasn't changed. And I think from the new business you are seeing, we have got a good value proposition for our customers.

Thanks.

Your next question comes from the line of David Barden with Banc of America.

Hey guys, good morning. Two questions, if I could. One is Jim, you were talking about the flexibility that kind of the balance sheet leverage currently provides you. Obviously, the buy back continues. But at its current pace and how the business is developing, in reality, the balance sheet is really idling right now with lots and lots of capacity available, maybe a couple of billion dollars of investment capacity. We have been sitting here kind of at these debt levels for a while now waiting for the options issue to kind of unfold and then we got past that and now it's kind of August, the second half of 2007. Can you kind of get a little bit more specific on time tables now? How long do we have to wait for India to develop before we are either going to pull the trigger or we are not? Are we... are you waiting around for the T-Mobile towers to kind of get done? Are you really focused on a U.S. acquisition or when are we going to get to at least the midpoint of this leverage ratio because it's been a while? Then the second, just Brad, on a smaller issue on the options expenses. Is this kind of a recurring number that's going to be kind of called out every quarter or is this kind of the last quarter we are going to have this kind of special number in the adjusted EBITDA? Thanks.

Okay, David, it's Jim. I'll go ahead and take the first one again. As far as our balance sheet flexibility, that's a purposeful strategy the company has. And we, as we have said in the past, run this company for the long term. We can't necessarily force the timing of strategic transactions, whether they are domestic or international. And so it's extremely difficult to give you a deadline by which if a deal isn't done, then we are going to change direction. So I am not going to do that. But I will tell that we've analyzed how value is created in the tower industry, and our conclusion is that while share repurchase are a valuable way to conduct yourself when you have the kind of performance that we have, that at the end of the day for the long run, adding assets at reasonable prices of enough scale to make a difference in the performance and size of the company is the highest value add that the management team can add. And so that's really what we are focused on. And I am not going to put a deadline on it because we can't force the timing.

And David, I think the only thing I would add to that is that having financial flexibility, especially as markets get uneven, and that's when asset values usually get more reasonable. And so maintain that flexibility is one of the things that Jim just mentioned and can lead to more value creation. With regard to the stock option expense, it has trended down. I think the top tick was about $6 million in the third quarter. It's gone from... in the first quarter, it was $2.8 million. It's $1.8 million this quarter. It may continue. We do have various lawsuits that we work on. But I think from a modeling perspective, it's very difficult to forecast. But I don't think it will go to zero in the near future, but if... $2 million a good run rate, it's probably not a bad one, but, as I said, it's very difficult to forecast.

And Brad, and I appreciate it. Thanks for those comments, and I know this kind of credit environment is kind of just the environment that you guys have set yourself up for from a leverage standpoint. But why doesn't it make sense to be at the midpoint of the leverage range and then to stretch to do deals that make sense rather than kind of sit at the bottom of the range and give yourself so much cushion that it calls into question what the point of that is?

Yes, David, when we look at the long term and where capital markets have been in the last two years and more comfortable, call it, leverages in the last two years may not be the same in the future. And so rather than trying to guess at that and then have to stretch to do the key strategic transactions and potentially be shut out from that if the capital markets are somewhat closed, we'd rather not put ourselves and paint ourselves in that corner. So that's really... you basically illuminated why we tend to leave our leverage at the lower end of the range.

Alright, guys. Thanks.

Yes.

Your next question comes from the line of Anthony Klarman with Deutsche Bank.

Thank you. Jim, I was hoping you could flush out more about the market in India. Obviously, you are now putting kind of concrete terms around it in the sense of you are committing to some sort of regional presence there. Could you just discuss a little bit the underlying dynamics of the market? I think we all know how many subs there are and how low the penetration is, but could you talk a little bit about more the factors behind that, things like zoning and some of the other factors that you think might be... drive the market significantly higher there for wireless infrastructure?

I think there are some very positive attributes in India and potentially in some other Asian markets. And it's, in India specifically, a matter of the size of the country, the population which gives you kind of two good elements even at this point, a sizeable wireless subscriber presence today, upwards of almost 200 million subs and fairly low penetration. Now at the other side of the corner, you have fairly low ARPU, and ultimately all 1.2 billion people probably can't afford a cell phone at the end of the day. But still, the numbers are just tremendous as far as sub growth, revenue growth for our wireless carrier customers and the need for infrastructure. So there is a tremendous need for tower space in the country. What we found during our visits and reinforced in my trip last month was that there really isn't, in my view, a commercial co-location marketplace in that country right now. Most towers are built by the carriers for their use on their network topology plan. There is some sharing that's sort of encouraged by the government, but there is a lot of friction in that sort of barter market. And I think the thing that we see as an opportunity is in some way to be the market maker for commercial, meaning cast rental base co-location in the country. And that's the biggest opportunity we see. To complement that, there are a number of carriers, there are some national carriers, there are regional carriers, a range of financing needs in size and scale among those. But we think many of them will be successful and so we have the attributes that we think in a country really provide an opportunity for us. And on the other hand, we know it's new, it's a different part of the world and we are going to be patient and try to work a value-added way into the market.

It may be really early to ask this question, but I will ask it anyway. I mean is it safe to assume that your potential entry into this market would signal that there is... that the hurdle rates that you think you can achieve there are at least as good as what you see in the U.S., Mexico and Brazil?

I think Anthony, anytime we put money to work, you should anticipate that if we do risk adjusted and compare it to other opportunities we have in terms of making investments, whether it's in the U.S., Mexico, Brazil or any other country.

Okay. Brad, for you. Previously, you guys completed the securitization and then you did a unsecured revolver at the holdco, and you had kind of indicated in the past that the revolver obviously would probably be accompanied at some point by additional either term debt or something that looked like term debt, and maybe the corporate bond market. Credit spreads have widened a lot over the last 3 or 4 weeks in the corporate market. And I was wondering if in fact that was sort of leading you to reassess what the strategy might be in laying out the AMT side of the balance sheet going forward.

I think Anthony, we are tapping into [ph] the marketplace and what's happened over the last few weeks. I think long term, we still would like to put longer term capital into the balance sheet and the capital structure. We are fairly opportunistic in how we view that and so we may still mix the various segments or elements of debt that we can tap, whether it's securitization, the bank market or the bond market depending on what's most appropriate and gives us the best rate is really the straightforward way to answer that. I think all markets with maybe the exception of the bank market, and we are not in the leverage loan market in terms of how we finance... we are in the relationship bank market... provides... they all have their challenges right now. But given that, we are continually looking to extend our balance sheet, get additional liquidity and we'll do that when it makes sense without having the pressure to do that.

So you... but you still think that it makes sense to have kind of a hybrid mix of securities that will allow you to stagger maturities and exposure to fixed versus floating and all the other elements that you have talked about in the past?

That's right. We don't believe when you have long-term assets, you should a short-term balance sheet in terms of liabilities. And matching those would make the most sense to us.

Okay. Final question on the stock buyback. If you look at what you are run rating in terms of repurchases, you'll, I think theoretically, be through that remaining $800 million long before February. Just wondering, I am assuming this is something the Board addresses probably regularly at the Board meetings. When do you plan to present perhaps the next phase of shareholder value return to the Board for consideration in a new program?

Anthony, let us get through or continue to make progress on our current share repurchase plan. And what we have done in the past is update you as we get near the end of one. And we view the conditions at that point and then we weigh our opportunities versus the size of any additional plan that we may undertake. And if that's the best way or the framework in which we view how we get to a size, and the repatriation of capital.

Thanks.

Your next question comes from the line of Rick Prentiss with Raymond James.

Hi guys.

Hey Rick.

I want to address the leverage questions maybe in a different way. Brad, can you update us on what you think the right range of leverage is? Is it still the 4 to 6 kind of zone? And if it is, how you compare to some of your compatriots who think more like 5 to 7 or even up towards 8 or 9 as appropriate?

I think we do. We still do think it's 4 to 6, and this is something we revisit quite often to make sure that we are thinking about it the right way. I think you can take different perspectives on it, whether it's 5 to 7 or 6 to 8. The way it's being financed, you get higher up those leveraged ranges with shorter term debt, which, by implication, requires higher financial risk. Given the current credit, or the past credit markets the last couple of years, that has not been a... the financial risk hasn't been a great element in this calculation of weighted average cost of capital. As markets may normalize or even get uneven, the financial risk becomes more apparent. And so we look at things over a long-term view and what makes sense from not just a point in time perspective, but a long-term perspective. And why do you want financial flexibility? How do you make investments and how do you finance yourself with a set of... a balance sheet that has more durability and doesn't rely on any single point in time financing. And that's really the way we look at it Rick.

I am going to take the opposite tact from David. I was around when thing boomed and then busted, so I am much more interested in somebody keeping the dry powder and being very disciplined on acquisitions so we don't see people overpaying for assets. In that regard, some of the press reports that we have seen out of India are suggesting some very high valuation for towers. And what I would like to understand, Jim, is since you've spent the last month in India and in Asia and getting to know those markets, what do you view as if you could get to a commercial co-location kind of market, what sort of rents would be willing to be paid in a lower ARPU environment? How good is zoning as far as protection from the standpoint of feeling comfortable that you are not going to get tower company B across the street building a tower and reducing the potential return. So just kind of speak to the India market maybe and a little bit of how you look at value per tower. Obviously, you are also looking at value per cash flow. I'll admit to being pretty ignorant still as far as what the Indian market, commercial model, might look like.

Sure, Rick. Low ARPU economies tend to also be low-cost economies. So Mexico and Brazil, low ARPUs traditionally than in the U.S., very similar, the cost to build a tower is lower in those countries typically than the U.S. And when you can match those kinds of economic factors up, you can still get a good risk adjusted return as we have in Mexico and Brazil. We are going to use the same approach in India or in other countries in Asia as we've used in the U.S., Mexico and Brazil. And then to take the cost of the asset, the rate of lease pricing that you can get, the cost of operations, roll that altogether and make sure you get a risk adjusted return that makes sense for this company. And that's exactly how we are going to do it over there. I would caution you not to believe every thing you read in the paper. You can believe what you read in our press release, this is because that will be the company's position. But other than that, speculation may occur in the future and it has in the past regard with regards to our company, and we haven't confirmed it. So I think you just look at our future actions in the context of our past actions, and that's price discipline, a good thorough [indiscernible] some of the assets that we bring into the company. And that's how we'll operate in India as well.

How about the zoning item?

Yes, it will develop as in Mexico and Brazil, early days and even in the U.S., zoning became tougher as time went on. In the cities, it starts first and it will roll out to the country side. So I think that there not a disruptive zoning environment in India that will develop.

Okay. And then Brad, on the discontinued op charge this quarter for satellite biz, any thoughts of what that might do? Obviously, reported net income is negative, but reported from continuing operations is a positive EPS. Any thought of how like an S&P would look at? Are you still considered a profitable company given the discontinued op charge?

The way S&P looks at the income requirement is from income from operating... continuing operations. So it does not... if you have a loss in discontinued operations, that doesn't count towards the requirement. But let me again caution you, we have nothing to do with how S&P ultimately maybe decides or figures out who is in their index and who isn't in the 500 index. So, but it is excluded from their analysis.

I just want to make sure it didn't put you in a penalty box as they look at stuff.

Yes. All we know is the regulations that are out there and what they publish on their website.

Great. Good luck guys.

Thanks.

Bye Rick.

Your next question comes from the line of Michael Rollins with Citigroup.

Hi good morning.

Hi Mike.

I guess another question about India. As you weigh how to make investments in that country, or other countries in the region, can you help us on how you are weighing organic builds versus an acquisition, especially with respect to the potential dilution to actually get an operation up and running? And if you can just help us think about is there a significant period of dilution, or are the returns on capital very immediate? And then kind of other little questions afterwards. Thanks.

Yes, Mike, it's Jim. I mean we've sort of passed this prologue again, entry into Brazil, entry into Mexico, and almost all of our international transactions in the past have been combined sale-leaseback, either a joint venture or 100% ownership on that piece plus a build to suit that ran parallel with that. So we are going to get immediate returns at some level out of a launch in any country, including India if it happens. And it will... that risk adjusted return hurdle we'll meet overtime that we have. So it may be diluted partly due to just start-up and scale ramifications, but we'll build it up overtime because of this purchase and build... building of towers as is done in parallel, which gets you towards the returns that you want.

And then just in terms of a couple of other details, what percent of revenue growth in the quarter came from upgrades? And then just following, Brad, on your comments in your opening, you said that you expected the sequential decline in the non-cash change in leasing revenue to be about $4 million sequentially, and it was only about $2.5 million. Does that suggest there is $1.5 million to come out in the third quarter or is now the drop $2.5 million the right run rate to begin at for the third quarter? Thanks.

Mike, with regard to the straight line question, we do expect about a $1.5 million drop from the second to the third quarter. So hopefully that answers that question.

And then the upgrades, Mike, as I mentioned, was about 20% of the new business that was not in that quarter, the second quarter.

Thank you.

Yes.

Your next question comes from the line of Vance Edelson with Morgan Stanley.

Hi, thanks for taking the question. If investment opportunities abroad or domestically prove superior to your current expectations, would you under any circumstances be willing to reduce the size of the share buyback in order to take advantage? And a related question regarding those opportunities. You mentioned you can't nail down the timing of say the T-Mobile tower bidding, but could you tell us what the current status is, what point you are at in reviewing the merits of that portfolio? Thanks.

I think Vance, any capital required for opportunities we would weigh at the time of when that opportunity comes up. So it's difficult to answer any type of hypothetical when you are saying what would you do with your share repurchase. So, I think the best way for you to think about it if we have opportunities, we would think about them as an alternative or in conjunction with share repurchases. With regard to any other strategic activity, and you mentioned T-Mobile, we don't comment on ongoing strategic activity. Most processes, when they are being run, usually have non-disclosure agreements and so we can't, even if we were involved, comment on them. So not to be evasive, but that's just the nature of these --

Okay, thanks. And Jim, you referenced Sprint putting in CDMA equipment on the legacy iDEN sites. Could you provide some color on whether that means swapping out the iDEN equipment, which would potentially be revenue neutral for you or is it more a matter of adding new equipment which would have positive implications?

Yes, it tends to be augmentations, Vance. So they are adding another set per sector line and antenna typically on the sites that they are going after.

Okay, thanks guys.

Sure.

Your next question comes from the line of Brett Feldman with Lehman Brothers.

Hi. Yes, thanks the taking the question. Can you give us an update on our business mix right now between U.S. and Latin America, both in aggregate and the mix of new revenue in the quarter?

In terms of the aggregate revenue, it's about 87% U.S. and 13% international. In terms of new business, the new business has been a little bit stronger in the U.S., so call it 90:10, not dramatically different, but it was a... we had a little bit stronger in the U.S.

Okay. And then just another question, as you mentioned, you are doing a lot of work with the AWS licensees as a prep for their network builds. Some of those licensees have expressed a little bit of frustration that the pace of clearing the spectrum with the government hasn't progressed quite as efficiently as they hoped. I am just wondering if we've gotten to the point where any of them have begun slowing or augmenting their deployment plans based on feedback they have gotten from the government.

I would say, Brett, it is not necessarily a across the board slowdown in AWS deployment. Each of these is very complex for the carrier and those tend to move resources around various markets based on how they are progressing. So I would say across the board, just not necessarily a big slowdown happening.

Okay, great. Thank you.

Yes.

And I think we have time for one more question.

And today's final question comes from the line of Jason Armstrong with Goldman Sachs. Jason Armstrong - Goldman, Sachs & Co: Thanks guys, and under the wire. So one, I guess just a follow-up question on the one just asked. You said no sort of broad slowdowns in AWS type opportunities. But if you look at the guidance here, you are sort of implying a steady uptick over the course of the year rather than any sort of lumpy increases coming in 3Q or 4Q. So just maybe some comments here. It actually does seem like some of the AWS stuff is slipping into early '08 or almost all of it slipping into early '08. Just further comments there. And then second, just more a data point. You've reduced the new tower build guidance from 200 down to 175. Just reasons for the decrease and then corresponding to that, why doesn't capital spending guidance go down as well?

Hey, Jason, with regard to the forecasted third quarter and fourth quarter revenue activity, we have been pretty consistent on this when we gave our initial guidance even back I believe in November of '06 for this year, which is we thought that there would not be an incremental impact from AWS in any meaningful kind of way. And so our guidance has incorporated the levels of activity that we thought would happen from most of the carriers deploying not just... not new spectrum, but they on their existing spectrum and for their new services. And that for the third and fourth quarter is playing out how we thought. The activity levels are very busy and we may have a little bit of bump potentially if things get a little flat [ph] if things are deployed a little bit faster in the fourth quarter. But it has never been in our numbers and we haven't really changed that outlook at all. Jim, I don't know if you want to comment.

Yes, I am just going to say there is a difference between the signings, which is the activity Brad is referring to, very active planning stage, lease processing applications, all that. And the commencements is the actual billing at which point we then book revenue. And, again, we have always said that we expected that really to... the commencements to happen in early 2008.

And with regard to the capital spending in the tower has gone from 200 to 175, we have been a little slower than what we had anticipated internationally that those 25 towers would represent $5 million of capital spending roughly in rough justice [ph]. And so I don't think that moves our guidance really in one direction or another because we could be spending in construction in progress for the next year at those levels of spending. And so that's why it was unchanged. Jason Armstrong - Goldman, Sachs & Co: Okay, great. Thanks.

Thanks guys and we appreciate everyone being on the call.

Yes.

There are no further questions. This concludes today's conference. You may now disconnect.